Current Marketing Thoughts

Highlights of the USDA Report

Sep 12, 2012

Bearish USDA report being digested by the trade this morning. Most analyst were thinking the USDA would push the corn yield down below the 122.8 yield number released this morning. In addition the USDA decided to keep "harvested acreage" unchanged for both corn and soybeans. As a result total US corn production was estimated at 10.727 billion, well above most all trade guesses. In addition ending stock were raised in both 11/12 and 12/13 marketing years. On top of this the USDA raised global ending corn stocks in both years as well. Not really sure how, but none-the-less they "RAISED" the ending stocks rather than lowering them. Some additional highlights are as follows:

Soybean yield lowered to 35.3 bushels per acre.

Australian wheat crop estimate left "unchanged" at 26MMT, the trade was looking for a substantial cut.

Russian wheat production cut big from 43MMT down to 39MMT.

Soybean ending stock left "unchanged" in 12/13 at 115 million.

Global ending stocks in wheat, corn and soybeans all "HIGHER" than most in the trade were expecting.

Outside markets are stronger as the US dollar trades down to four month lows. Moody’s Investors Service yesterday stating the US runs the risk of losing its "triple-A" rating by early next year if something doesn't drastically change. On top of that reports this morning indicating "Germany's Federal Constitutional Court" cleared the way for Berlin to ratify the euro zone’s permanent rescue fund. Essentially meaning the Germans will NOT block the EU bailout proposal. Also keep in mind the US Fed starts it two-day meeting this morning. Another round of quantitative easing could pressure the US dollar even lower, ultimately giving the commodity bulls even more to cheer about. We'll have more updates coming!

I have gone in to much greater detail on this morning's USDA report. If you would like to read my daily report and receive some critical strategies that you can implement to help improve your marketing, simply click here to get started - Van Trump Report